If you have been audited by the IRS and they raised your tax obligation, you have probably received a notice of your right to appeal the auditor’s report. These appeals go through the IRS Tax Appeals office, which is a separate office from the one that conducted your audit. The tax appeal officer who is assigned to your case has the discretion (and often the desire) to reach a settlement with you to avoid costly litigation. For this reason, an appeal might be a good choice.
Requirements of a Tax Appeal Letter
If your tax bill increased by more than $25,000, you will need to file a formal protest in writing. This letter will need to include:
- Your name and contact information
- A declaration that you are appealing the results of your audit
- A copy of the auditor’s report
- A full list of each part of the report that you wish to challenge, including
- The reason that you disagree with each finding
- Facts, including documents, affidavits, and witness statements that support your position
- Legal authority that supports your position
- A signature and attestation that states: “Under the penalties of perjury, I declare that the facts stated in this protest and any accompanying documents are true, correct, and complete to the best of my knowledge and belief.”
Consult with An Attorney Before Sending Your Letter
I would recommend that you consult with an attorney before preparing and submitting this written protest. This letter will provide your first impression to the appeals office, so it is important to get it right. In addition, an attorney will be able to review your auditor’s report and: (1) identify compelling arguments and think like a tax appeal officer would think; (2) rate the strengths and weaknesses of potential arguments based on that attorney’s experience handling tax appeals; (3) direct you to all the necessary documentation, records, and witnesses that you will need to establish the facts supporting your argument; (4) provide legal research to identify statutes and case law to support your position; and (5) help you draft a clean, powerful protest letter.
In preparing to meet with your attorney regarding an appeal, I suggest that you:
- Develop a list of question for your lawyer. It benefits you and your lawyer when you are fully informed.
- Put together a folder containing the last several years of your tax returns, your auditor’s report and any correspondence you have received from the IRS, and all documents that you or your CPA used to prepare your tax return.
- Bring a list of witnesses that may have information relevant to your appeal.
- Think about what arguments you would like to make and explain these to your attorney. However, don’t be surprised if your attorney chooses to use other arguments instead. An experienced tax attorney will know how to get the IRS’s attention. Sometimes, half the battle is convincing the appeals officer that your case has the strength to go to trial.
Again, a tax appeal may be a good option for you, especially if your tax obligation has been significantly increased. A tax attorney can evaluate your case and advise you on your chances of success. With over twenty years of experience representing clients in tax matters, a Master of Law Degree (LLM) in Taxation, and a license to practice in the United States Tax Court, I can help you resolve your tax problems. Call The Law Offices of Robert S. Thomas telephone at 847-392-5893 or visit our website today.